Your iPhone as Your Credit Card

gga

Back in 2008, just before the iPhone first launched in Australia, I
wrote a long
piece describing why I thought the iPhone would have a pretty
fatal impact on carriers and existing hand-set manufacturers.

In the last couple of days, Apple has added security questions to
iTunes store accounts. Credit card companies should now be very
worried.

Why?

As I have said before, and as now drives my work in mobile
strategy and implementation, in the world of mobile, user experience is
king. A king with the potential to change the way we use the web. By
focussing on controlling your access to their network and protecting
SMS revenues, carriers held back mobile potential and ultimately
reduced themselves to being a dumb pipe.

Wresting control of the hand-sets back from the carriers has given us
apps and a usable mobile web. Billing and purchasing have remained
with the carriers, though they have failed to do anything with this.

Now that I’ve been living in the US and India, I have a renewed
appreciation for how painful the experience of purchasing online can
be. The credit card companies and merchants may or may not force me
through a horrible gauntlet of slow loading, ugly and hard-to-use web
pages to verify my card. Typically by asking me for information I
don’t have. Most of the time I actually fail to buy anything. I now
view paying for things online with much trepidation. PayPal is not an
improvement. Using PayPal is worse than a credit card.

Buying music or TV shows from the iTunes Music Store is wildly
different: I click “Buy”, I type in my password. There is no step three.

Sure, there are other problems (DRM on TVs and movies for one.) But in
contrast to the abject failure that is just about all other online
stores, this is streets ahead. The world of credit card purchasing is
desperately in need of a user experience re-vamp.

Currently, Apple’s iTunes purchasing process can only be used to buy
items from Apple’s stores (apps, music, media, computers) or
content for apps purchased from their store. What if that same
process could be used to purchase other items?

This is not a question of technology. The tech for payment
gateways has existed for a long-time. This is a question of
user-experience.

Except for one piece of technology: near-field
communications. This allows data to be exchanged just by
touching devices. Imagine if you could touch your iPhone to the cash
register, type in your password and pay for your purchase?
Convenient. And secure: your phone would never leave your hands. This
is the Google Wallet dream, and I want it (perhaps without the
creepy track-all-my-purchases spice Google will add.) But
unfortunately Google sees this as mainly a technology problem, not as
an experience problem.

There is a major new iPhone due out this year, if Apple continues
their current release schedule.

So, online payment sucks, except for the iTunes store. Carriers have
failed to capitalise on their billing relationships. Apple understands
experience as the critical factor deeper than the other large
companies in these worlds. But why should credit card companies be
afraid just because Apple has added security questions? Because why
has Apple suddenly added these? Are they planning an expansion? What
if they released a Square-like POS device at the same time as
they included NFC chips in the next iPhone? What if they offered an
iTunes payment gateway for web purchases?

Because, given the choice between all the current options and using my
iTunes account I know which I’d choose.